Already a member?

Amylin Shoots Up on Takeover Rumors - Analyst Blog

Amylin Pharmaceutical
(
AMLN
) shares shot up 54.45% on rumors regarding a take-over bid by
Bristol-Myers Squibb
(
BMY
). According to Bloomberg, which cited unnamed sources,
Bristol-Myers had made an offer of $22 per share ($3.5 billion).
However, the offer was rejected by Amylin's board of directors last
month.

Why Amylin?

Following the termination of Amylin's exenatide agreement with
Eli Lilly
(
LLY
) in November 2011, Amylin has been considered to be a potential
takeover candidate for companies with a focus on diabetes. Amylin's
exenatide franchise consists of Byetta and Bydureon (once-weekly
exenatide). While Byetta sales have been lagging expectations,
Bydureon, which was launched earlier this year in the US, could
very well be a blockbuster.

Amylin is currently looking for ex-US partners for the exenatide
franchise, which should help maximize the value of the product.

Meanwhile, Bristol-Myers has been pretty active on the
acquisition front over the past few quarters. Earlier this year,
the company acquired Inhibitex. Other acquisitions in the recent
past include Medarex, Inc., ZymoGenetics, Inc., and Amira
Pharmaceuticals, Inc.

With Bristol-Myers already having a presence in the diabetes
market (Onglyza and Kombiglyze), the Amylin acquisition would make
sense. Bristol-Myers is facing a major patent cliff with its
lead product, Plavix, slated to lose US exclusivity in May
2012.

Our Take

Amylin could be an attractive takeover target for companies with
a focus on the diabetes market. Chances remain that other companies
could express an interest in acquiring Amylin and a deal could be
sealed in the late 20s.

We currently have a Neutral recommendation on Amylin, which
carries a Zacks #3 Rank (short-term "Hold" rating).

Please note that once you make your selection, it will apply to all future visits to NASDAQ.com.
If, at any time, you are interested in reverting to our default settings, please select Default Setting above.

If you have any questions or encounter any issues in changing your default settings, please email isfeedback@nasdaq.com.

Please confirm your selection:

You have selected to change your default setting for the Quote Search. This will now be your default target page;
unless you change your configuration again, or you delete your
cookies. Are you sure you want to change your settings?